The Centurylink Technology Solutions Blog - Trends in IT Infrastructure

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When reporters asked Willie Sutton, one of America's most prolific bank robbers, why he robbed banks, his response instantly became legend: "Because that's where the money is." 

 

This story is quite likely apocryphal, but remains ensconced in our cultural memory because of its unremitting logic. Of course, the logical targets of modern bad actors aren't bank vaults, but the IT infrastructure and proprietary data of financial institutions.

FinancialIcon_Larger.jpgEvery week, it seems, we hear about another attack on IT security in the financial services sector.  This heightened awareness has firms taking extensive in-house precautions to raise firewalls, lock down apps and servers, and pursue other best-practice strategies.

 

But under the strain of constant threats and rapid evolution of new technologies, IT leaders can't help but wonder: Is what I'm doing enough?

Steve Bacastow for web2.jpgMobile payments: The new frontier? Possibly, if you read the analyst reports. Yesterday, Forrester predicted the mobile payment market in the United States alone will reach $90 billion transactions by 2017.

 

This week, cloud-based mobile payments provider Mozido revealed plans to leverage Savvis' cloud and IT hosting solutions for its mobile payments platform.

 

We sat down with Steve Bacastow, senior vice president of operations at the Austin-based company, to talk about how outsourcing to the cloud aligns with Mozido's tailored solutions for global and regional brands in financial services, consumer packaged goods, telecommunications and retail.

 

Financial Services IconFinancial services firms are increasingly facing the challenge of big data: Unprecedented quantities of structured and unstructured data stored in a variety of systems and formats.

 

Though "big" might mean hundreds of gigabytes for one company and hundreds of terabytes for another, all companies report that more data is coming in all the time from disparate systems. For example, in a recent survey from the Economist Intelligence Unit, 73 percent of respondents in the financial services industry say that data collection has increased in the last year.

 

Big data presents a big challenge for financial services firms. The sheer amount of storage required to keep it strains IT infrastructure, crowding physical storage capacity. Worse, big data overwhelms management capabilities.

 

In the same survey, nearly one-third of respondents admit to insufficient data governance practices. Due to the scale and heterogeneity of big data, firms often can't be completely sure that they've locked down compliance with regulatory and other requirements -- and this worries them, because they know that it opens them up to potential legal challenges.

 

Because big data is so unwieldy, companies are often not able to put it to use. The explosion of big data has affected all industries, but the capital market has its own unique set of issues, such as the need to capture time-series data and merge it with real-time event processing systems. This and other challenges unique to financial services complicates IT's struggle to deliver important data to the right people within an acceptable timeframe. Nearly one in four financial services respondents in the Economist survey said the vast majority of its company's data is untapped, and another 53 percent said they use only half of their data.

 

But though most financial services organizations aren't able to put big data to good use, they know that it has potential to be enormously valuable. The Economist Intelligence Unit survey shows a strong linkage between effective data management strategy and financial performance, with companies that use data most effectively standing out from the rest.

 

Savvis recently published a white paper that discusses these issues, including use cases that show how partnering with innovators can open new opportunities. Key areas addressed include:

 

- How effective management of big data can make a difference

- What's keeping firms from making the most of big data?

- How Infrastructure-as-a-Service (IaaS) providers can help to resolve technical challenges

 

Please click here to download the white paper.

 

Varghese Thomas is global head of financial services at Savvis.

Financial Services IconMy client meetings over the last quarter have put me in front of some of the world's largest investment banks, trading firms and financial institutions. As IT leaders, we all work in a challenging economic climate with increasingly complex demands on our organisations. But my meetings brought into sharp focus the importance of competitive advantage in the industry.

 

In the financial markets, there are two key differentiators on which the IT organisation - and the decisions they make about their infrastructure - can have a direct impact: High-speed trading and access to markets.

 

The revenue potential of high-frequency trading has goaded even traditional institutional trading firms into pressing their IT infrastructures to achieve ever-lower latency and stay competitive. Firms are now jockeying to make trading as fast as possible. Latency is now down to milliseconds, and it's being pushed to microseconds or even nanoseconds.

 

Is this mad dash for lower latency justified? Do miniscule time differences that the human brain has a hard time imagining really matter? The answer is an unqualified yes.

 

High-frequency traders are now significant market players, with estimates placing the percentage of trading volume in the U.S. equities markets at 60 percent and in Europe at 35 percent (Celent, TABB Group, 2011). All this is dramatically changing the competitive landscape and making it more difficult and costly to connect to the numerous sources of liquidity.

 

Technological innovations help solve these challenges -- and create new ones. The virtual "arms race" in ultra-low-latency direct feeds and platforms coupled with the explosion in market data volume creates connectivity issues for trading firms that need to access all the new liquidity venues and blend the data in a way that allows them to intelligently use it in their trading systems. Algorithmic trading is now considered such a standard practice across asset classes throughout the industry that automation is part of the competitive landscape, since deciding manually when and where to trade is virtually impossible with so many venues and when liquidity is shifting from one place to another in such compressed timeframes, at the same time complying with regulations to provide best execution of trades.

 

Trading "ecosystems" increasingly offer an attractive solution to these and other challenges. Such ecosystems bring together liquidity points, content, services and IT infrastructure to enable successful execution of the entire trading lifecycle. Positioned in close proximity to -- or inside -- major sources of liquidity, such ecosystems allow trading firms to shift the burden of technology acquisition, maintenance, and management over to specialists, while supporting critical pre-trade, trade execution, and post-trade activities so they can focus on their core businesses.

 

This ecosystem strategy is one that Savvis has followed with our new London Docklands data centre, LO3. Located at the heart of London's financial markets, LO3 offers opportunities for low-latency connectivity with diverse fibre routes from multiple providers offering connections to the European regions' trading platforms. Colocated financial firms can connect into more than 200 multi-asset global exchanges and alternative liquidity venue feeds. Take a look at http://go.savvis.net/LO3getcloser.

 

Neil Cresswell is managing director, EMEA, for Savvis, a CenturyLink company.